Nifty Realty index 33-month high; Indiabulls surges over 10%

Indiabulls, Godrej Prop, DLF, Prestige Estate, Dilip Buildcon and Ajmera Realty hit 52-week highs

Shares of real estate companies were in focus with the Nifty Realty index hitting 33-month high on the National Stock Exchange (NSE) in intra-day trade after a strong rally in Indiabulls Real Estate, Housing Development & Infrastructure (HDIL) and Godrej Properties.

At 10:15 am; Nifty Realty index was the largest gainer among sectoral indices. It was up 3.7% at 261.80 as compared to 0.47% rise in the Nifty 50 index. The realty index hit an intra-day high of 262, its highest level since July 11, 2014 on NSE.

The S&P BSE Realty index was up 4.5% against 0.44% gain in the S&P BSE Sensex. Thus far in the calendar year 2017, the realty index surged 59% as compared to 12% rise in the benchmark index.

Indiabulls Real Estate (up 14% to Rs 163), Godrej Properties (4% at Rs 489), DLF (3% at Rs 193) and Prestige Estate (2% at Rs 260) from the Nifty Realty index, Dilip Buildcon, Ajmera Realty and Hub Town from the non-index hit their respective 52-week highs on the NSE in intra-day trade.

Indiabulls Real Estate zoomed 54% in the past six trading sessions after the company announced a business restructuring plan that will see the company splitting itself into two parts.

A commercial entity wherein the company hopes to get a strategic investor in place to further develop the business and target doubling of rents in four years and a residential entity, which targets to cut its debt by more than half in two years, eventually reaching a zero debt/positive net cash position.

Analyst at JP Morgan in recent report said “In the interim, if the company is able to transact a stake in its rentco, then it will help establish valuation benchmark for the rental company – very similar to what other property developers have done, and accelerate its overall debt reduction target”.

We will monitor how the company’s free cash moves over the next two to three quarters, added report.

COMPANY	LATEST	PREV CLOSE	GAIN(%)
INDBULL.REALEST.	156.60	143.00	9.5
DILIP BUILDCON	434.45	410.85	5.7
SUNTECK REALTY	448.95	427.15	5.1
D B REALTY	52.65	50.55	4.2
GODREJ PROPERT.	486.20	469.15	3.6
H D I L	94.55	91.85	2.9
DLF	187.60	183.45	2.3
KOLTE PATIL DEV.	187.55	183.65	2.1
OBEROI REALTY	401.05	393.95	1.8
PHOENIX MILLS	406.00	401.60	1.1
PRESTIGE ESTATES	256.80	254.05	1.1
SWAN ENERGY	160.75	159.10	1.0